General government generates €215m surplus in January to July

The general government generated a €215.2m budget surplus on a cash basis in January to July, compared to a €91.2m shortfall in the respective period of 2016, the finance ministry said.

The surplus in the first seven months of the year was mainly on an increase in public revenue by €441m to almost €4bn more than offsetting a €112m increase in spending to €3.8m, the ministry said in a statement on its website.

The increase in revenue was on a €182m rise in indirect tax revenue to €1.6bn in January to July compared to the respective period last year, including a €133m increase in value added tax revenue to €974m, and a €108m rise in direct tax revenue to over €1.1bn, the ministry said. Social security contributions rose by €69m to €658.1m, reflecting an increase in employment, and by €73m in non-tax revenue to €533.2m.

In January to July, public expenditure rose mainly on €67m increase in interest payments to €385.2m, caused by the recent bond buybacks and early debt repayments following the issue of the €850m government bond in June, followed by an increase in wages and salaries and spending on goods and services of €29m and €26m to €950.4m and €220.5m respectively, the ministry said. Pensions rose by €10m to €315.4, and current transfers by €8m to €826.4m. Subsidies and capital expenditure fell by €32m and €4m to €42.5m €113.7m respectively.

The government accumulated in the first seven months of the year a primary surplus, which is the interest of revenue and expenditure excluding interest payments, of €547.5m, the ministry said.